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MONTHLY REVIEW
OF
B U S IN E S S
C O N D IT IO N S
ISAAC B. NEWTON, Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Vol. XV
San Francisco, California, December 21,1931
No. 12
S U M M A R Y O F N A T IO N A L C O N D IT IO N S
Prepared by the Federal Reserve Board
Industrial activity and factory employment
declined further from O ctober to November,
reflecting in part the usual seasonal tendencies.
Continued gold imports and further reduction
in member bank reserve requirements during
November and the first half of December were
reflected in a considerable decline in the out
standing volume of reserve bank credit.
Production and Employment. In November
industrial production showed a somewhat
larger decrease than is usual at this season, and
the Board’s seasonally adjusted index declined
from 73 to 72 per cent of the 1923-1925 average.
A ctivity declined at woolen mills, lumber mills,
and coal mines, while daily average output at
steel mills increased and volume of automobile
production showed less than the usual seasonal
decline from the low level of October. The
November increase in steel production was fol
lowed by a considerable decline in the first three
weeks of December. Output of petroleum in
creased further in N ovem ber to a level slightly
lower than that prevailing last summer before
output was sharply curtailed.
Volum e of employment in most manufactur
ing industries declined by more than the sea
sonal amount between the middle of October
and the middle of November. Reductions were
particularly large in the wearing apparel,
leather, and building materials industries, while
in the automobile and tire industries declines
were smaller than is usual at this season.
The value of building contracts awarded, as
reported by the F. W . D odge Corporation, has
declined further in recent months and a prelim
inary estimate of the Board’s seasonally ad
justed index for the last quarter of 1931 is 49
per cent of the 1923-1925 average, compared
with 59 for the third quarter, 65 for the second
quarter, and 79 for the first quarter of the year.
Part of this decline in dollar volume reflects
lower building costs.
Production of principal crops in 1931 was
about 10 per cent larger than in 1930, according
to the December crop report of the Department
of Agriculture, while acreage harvested was
slightly smaller than a year ago. There were
large increases in the crops of cotton, corn,
winter wheat, apples and peaches, while the
harvests of oats, barley, and rye were smaller
than last year. As in 1930, the hay crop was
unusually small.
Distribution. Commodity distribution con
tinued at about the same rate in N ovem ber as
in October, the volume of freight carloadings
showing a seasonal decline, while sales at de
partment stores increased by about the usual
amount for that month.
W holesale Prices. The general level of
wholesale prices remained practically un-
PER CENT
INDUSTRIAL PRODUCTION
Indexnumbers of industrial productionadjustedfor seasonal varia
tions (1923-1925average=100).
FAGTORY
EM PLOYM ENT
F ederal R eserve B o a rd 's index o f factory em ploym ent, w ith adjust
m ent fo r seasonal variations (1923-1925 average = 100).
90
December, 1931
MONTHLY REVIEW OF BUSINESS CONDITIONS
changed from O ctober to November, according
to the Bureau of Labor Statistics’ index. Prices
of grains, petroleum, and silver advanced
while those of livestock and dairy products
showed declines, partly of a seasonal character.
Between the middle of Novem ber and the mid
dle of December there were decreases in the
prices of many leading commodities including
livestock, meats, grains, sugar, silk, and silver.
During this period prices of copper and rubber
showed a decline, follow ed by a recovery.
Japan, and a continued reduction in the reserve
balances of member banks reflecting a further
liquidation of member credit. Demand for cur
rency declined during the last three weeks of
November, and showed considerably less than
the usual seasonal increase in the first half of
December. A fter the middle of December, how
ever, bank suspensions in New England were
followed by some increased withdrawals of
currency, part of which has begun to return.
Loans and investments of member banks in
B IL L IO N S O F D O L L A R S
PER CENT
...... 11 ..............
A L L O THER
1
LO A N S^ *’
A
# 4
L O A N S (DN
SECU RI
1
T2 k s
A
• I
v
v
s.
V
J
1927
IN 'i / E S T M E N T s
1928
1929
1930
1931
R A IL R O A D F R E I G H T -C A R L O A D IN G S
M E M B E R B A N K C R E D IT
In dexes of daily average num ber o f cars loaded, adjusted for seasonal
variations (1923-1925 average = 100).
M o n th ly averages o f w eek ly figures for reporting m em ber banks in
leading cities. Latest figures are averages o f first tw o
w eek s in D e ce m b e r.
Bank Credit. V olum e of reserve bank credit
outstanding declined during November and the
first half of Decem ber and averaged $360,000,000 less in the week ending December 12 than
at its O ctober peak, seven weeks earlier. The
decrease was in large part in the banks’ port
folio of acceptances, as discounts for member
banks and holdings of United States govern
ment securities showed little change for the
period. The decline in total volume of reserve
bank credit outstanding during the period re
flected a growth of $100,000,000 in the stock of
monetary gold, largely through imports from
leading cities continued to decline and on D e
cember 9 were $370,000,000 smaller than four
weeks earlier. The decrease was equally di
vided between the banks’ loans and their in
vestments. Deposits of these banks, both
demand and time, also showed a decrease, with
a consquent reduction in required reserves.
M oney rates in the open market showed little
change from the middle of November to the
middle of December. Rates on prime commer
cial paper continued at 3^4 to 4 per cent, while
rates on 90-day bankers’ acceptances advanced
from 2 to 3 per cent on November 25.
T W E L F T H F E D E R A L R E S E R V E D IS T R IC T C O N D IT IO N S
The volume of business transacted in the
Tw elfth District was smaller in November
than in October, after allowance for the sea
sonal changes customary during that month.
Industrial operations continued to slacken and
distribution of commodities was slower than in
the preceding month. Prices of non-ferrous
metals and agricultural products important in
the District declined during late November
and the first half of December. Reserve Bank
credit in use continued to recede from the high
levels of October.
Crop and livestock marketing declined sea
sonally during November. Soil moisture and
irrigation water were further replenished dur
ing the month by rain and snowfall. On D e
cember 1, precipitation for the crop year ap
proximated the long-time average, and was
considerably in excess of the past two years.
Late November frosts damaged the Navel or
ange crop slightly. It seems probable that the
heavy snowpacks on higher ranges will neces
sitate larger than usual quantities of supple
mental feed for livestock during the current
winter.
Production of crude oil in California re
mained unchanged during November, but the
amount run to refinery stills declined som e
what as compared with October. Gasoline in
ventories increased considerably from the
preceding month, as is usual in November.
Output of lumber declined sharply, the total
for the month being the lowest since February,
1921. Proportionate decreases were not re
corded in shipments and orders of that com
modity, however, and stocks declined. Building
permits issued and construction contracts
awarded were unusually small in value during
December, 1931
November and cement production declined
more than seasonally. A ctivity at flour mills
remained at a high level. Approxim ately the
seasonal decreases were reported in em ploy
ment.
There was no appreciable change in retail
sales during November, although a moderate
increase is customary during that month. R eg
istrations of new automobiles declined more
than seasonally, while the usual O ctober-N ovember changes were recorded in wholesale
trade. A pronounced reduction in eastbound
shipments of lumber and petroleum through
the Panama Canal and a contrary to seasonal
decline in the westbound shipments resulted
in a decrease in intercoastal traffic during N o
vember. Adjusted carloadings declined slightly.
Total discounts and locally purchased ac
ceptances held by the Federal Reserve Bank
of San Francisco declined considerably during
the four weeks ended Decem ber 16. A moder
ate loss of funds to other parts of the United
States through settlement of commercial and
financial transactions was more than offset by
an excess of Treasury expenditures over re
ceipts in this District. Demand for banking
funds was reduced as a result of a non-seasonal decline in the amount of money in cir
culation and a reduction in reserve deposits
maintained by member banks. Low er time and
demand deposits and a declining volume of
loans were reported by member banks between
November 18 and December 16. Participation
by those banks in the large Decem ber 15 Treas
ury financing resulted in a considerable in
crease in both their investments and their
Government deposits.
A griculture
During the current marketing season most
crops and animal products sold in local and
national markets have brought progressively
smaller unit returns with the advance of the
season and prices generally have been lower
than a year ago. This decline in the prices of
agricultural products, together with a decline
in the volume of production, has resulted in
markedly lower agricultural returns during
1931 than in other recent years. The volume
of agricultural products marketed during N o
vember this year was smaller than in N ovem
ber, 1930.
In contrast with the current unfavorable
econom ic situation in agriculture, the outlook
for the growth of crops during 1932 has been
improved considerably by recent rain and
snowfall. After two successive years of scant
precipitation, snow storages in the mountain
areas and subterranean water supplies had
been seriously reduced. By December 1 of
this season, however, rainfall had approached
91
FEDERAL RESERVE AGENT AT SAN FRANCISCO
the long-time average for most parts of the
District and snow storages which furnish water
during summer months had reached the
greatest depths of recent years. In the Pacific
Northwest, snowfall has already been suffi
cient to insure protection during winter months
for fall-sown wheat. The acreage sown to
wheat in Idaho, Oregon, and W ashington this
past autumn was estimated on December 1
to be 2,818,000 acres, which is 6 per cent less
than was sown in the autumn of 1930. The
condition of this crop is somewhat poorer than
a year ago.
As a result of frosts during late November
the 1931-1932 Navel orange crop in California
was estimated to have been reduced 517,000
boxes from a previously forecasted crop of 13,568,000 boxes. The estimate of the lemon crop,
on the other hand, was increased to 6,174,000
boxes from an estimate of 6,015,880 boxes in
late October. Lemon production during 19301931 amounted to 6,342,000 boxes. Orange and
lemon prices declined during November to
levels lower than those prevailing in the pre
ceding month or the same month a year ago.
Butter and egg prices declined seasonally at
Pacific Coast markets during late November
and early December and in the middle of the
later month were selling at prices approxi
mately equal to those of a year ago. Storage
holdings of eggs and butter at Pacific Coast
centers on December 1 were 46 per cent and
63 per cent smaller, respectively, than on D e
cember 1, 1930. Receipts of eggs at Los A n
geles, San Francisco, and Portland for the
season to December 1 were 9 per cent less than
a year ago, while butter receipts for the same
period were 9 per cent greater than a year ago.
The frequent rains of late November and
early December improved forage prospects on
livestock ranges in the lower altitudes of the
Agricultural M arketing —
t-----N o v e m b e r------%
r - Season to D ate —>
1931
1930
1931
1930
4,958
593
4,757
6,393
9,543
661
3,831
6,989
22,930
593
4,757
16,912
38,464
661
3,831
20,948
312
544
4,300
4,104
1,912,927
145,856
2,150,228
852,834
12,482,451
2,557,476
13,080,366
4,835,855
45,447
161,941
156,870
E ggs (c a s e s )? ...
134,113
B u tte r ( l b . ) $ . . . . 5,660,826
37,795
123,855
187,147
106,149
4,754,789
436,939
1,367,813
1,912,613
1,724,226
72,751,367
430,577
1,251,770
1,558,413
1,898,714
67,014,822
S to r a g e H o ld in g s
(e n d o f m o n th )
W h e a t ( b u .) . . . . 4,322,000
B eans (b a g s ) . . . . 2 ,532,916
B u tte r ( l b . ) ......... 1,487,199
E g g s (c a s e s ) . . . .
141,510
A p p le s (c a r lo a d s )
18,875
4,100,000
2,605,813
4,030,850
259,221
19,193
C a rlo t S h ip m e n ts
L e m o n s .................
O ra n g e s .................
V e g e ta b le s ( C a l .) .
E g g s (C a l., O re .,
and W a s h .) . . . .
E x p o r ts
W h e a t ( b u .)
B a rle y ( b u .)
....
....
R e c e ip ts
H ogsf
......................
f S i x m ark ets.
$ T h ree m arkets.
92
District, but on the higher winter ranges
snowfall has necessitated the use of increased
quantities of hay and grain for supplemental
feeding. Extensive use of feed may be neces
sary to maintain cattle and sheep this winter,
for large numbers of animals have entered the
winter months in rather poor flesh due to the
widespread shortage of range forage last sum
mer. W hile feed supplies are considered ade
quate for a normal year, their sufficiency
would be doubtful were the current winter un
usually severe or prolonged. It is expected that
fewer lambs will be fed in the District this
winter than last, principally because of re
duced numbers in Utah and Idaho, where there
is a shortage of feed. The number of cattle fed
will probably be a little larger than a year
ago, increased feeding o f cattle in California
and Arizona offsetting the decreased feeding in
Idaho and Utah.
Receipts of cattle and hogs were larger dur
ing November, 1931, than in November, 1930,
while receipts of sheep declined over the year
period. In accordance with seasonal m ove
ments marketing of cattle and sheep declined
from the preceding month, while receipts of
hogs increased.
In d u stry
Industrial activity in the Tw elfth District,
after having remained comparatively stable at
low levels during September and October, re
sumed its earlier downtrend during November.
Production of crude oil continued at the same
rate as in O ctober but available data indicate
that output of refined oils declined slightly
during the month. Output of cement and lum
ber decreased considerably more than is usual
at this season and building activity also de
clined sharply. Little change was evident in
the non-ferrous metals mining industry.
A m ong Twelfth District industries for which
information is received the only appreciable
increase in activity was in flour milling, which
responded to orders from the Federal Farm
Board for export to China. Employment was
at approximately the same low level as in
October.
Output of crude oil in California averaged
approximately 500,000 barrels daily during N o
vember or practically the same as in October.
Announcement was made on December 18 to
the effect that allowable production under the
curtailment plan now in operation in California
was to be further reduced from 487,500 to
456,700 barrels daily. Refining activity, as in
dicated by the amount of crude oil run to stills,
was somewhat lower during November than
in the previous month. As is usual at this sea
son, when consumption is at a low level, gaso
line stocks increased by a substantial amount.
Since the opening of an international con
ference of copper producers during October
figures on the production of copper have not
been released. Reports indicate, however, that
no appreciable change has taken place in mine
output of that metal during the past two
months. Development work continued in the
gold producing sections of the District, the
only mining areas reported as being active.
Output of lumber was about 30 per cent
smaller during November than in October, al
though the decline during the later month is
usually only 9 per cent. This drastic curtail
ment of production reduced this Bank’s seaE m ploym ent—
•Californiia----------% ,-------------O r e g o n —-----------v
N o. of
N o. of
N o.
N o . /—E m ployees —>
t— E m p lo yees —>
N o v .,
of
of
N o v .,
N o v .,
N o v .,
1930
1930
Firm s
1931
Firm s 1931
Industry—
Indexes of daily average production, adjusted for seasonal variations
(1923-1925 daily average** 100)
— 1931Sept.
N o v . O ct.
51
48
48
149
158
G e n e r a l:
C a rlo a d in g s — In d u s tr ia l . ....................
E le c t r ic P o w e r P r o d u c t i o n ...............
M a n u fa c t u r e s :
L u m b e r ........................................................
F lo u r
34
............................................................ . . . 115
56
W o o l C o n s u m p t i o n ! ...............................
M in e ra ls :
P e tro le u m (C a lifo r n ia )t .................... . .
C o p p e r (U n it e d S t a t e s )$ .................
S ilv e r (U n it e d S ta te s ) $ .......................
.
45
139
117
98
65
115
52
146
102
102
56
91
1930
N ov.
70
156
63
196
96
78
99
71
76
76
58
40
68
40
77
60
67
39
92
82
83
47
62
63
B u ild in g a n d C o n s tr u c tio n §
. 42
T o t a l .............................................................
V a lu e o f B u ild in g P e r m its
T w e n t y L a r g e r C itie s ...................... . . 24
S e v e n ty S m a lle r C itie s ................... , . . 28
V a lu e o f E n g in e e r in g C o n tr a c ts
A w arded
T o t a l ....................................................... . 69
E x c lu d in g B u ild in g s ................. .. . . 104
Industries
A ll Industries* . . . . 1 196
136,982
( - 1 9 .5 )
170,096
5,819
( — 2 0 .2 )
7,288
15,843
( — 2 5 .6 )
1,802
17
(•— 19.2)
21,287
11,822
( — 9 .6 )
13,081
S to n e , C la y and
G lass P r o d u c t s .
61
L u m b e r and W o o d
M a n u fa c tu r e s . .
145
C lo th in g , M illin e ry
and L a u n d e r in g . 159
F o o d , B e v e ra g e s ,
an d T o b a c c o . . .
P u b lic U tilitie s
..
281
39
76
O th e r In d u s t r ie s t . 480
M is c e lla n e o u s
26
29
30
33
48
51
78
121
107
189
117
142
fNot adjusted for seasonal variations. IPrepared by Federal
Reserve Board. §Indexes are for three months ending with
the month indicated.
December, 1931
MONTHLY REVIEW OF BUSINESS CONDITIONS
W h o le s a le an d
...
53
29,685
( — 18.5)
48,890
( — 15.1)
64,581
( — 2 1 .7 )
7,430
(2 .3 )
2,230
36,421
127
16,908
(--1 7 .0 )
2
156
( - - 1 1 .9 )
20,383
177
8,606
( - -1 7 .4 )
1,268
8
( 4 .3 )
10,422
341
( - - 1 0 .5 )
381
37
1,874
( - - 4 1 .4 )
3,199
28
4,663
( — 6 .5 )
4,988
44
Si
1,216
57,565
82,525
7,264
146 33,585
35,558
( — 5 .5 )
* P u b lic u tilitie s an d w h o le s a le an d retail^ figu re s n o t in c lu d e d in
th is total, t I n c lu d e s the fo llo w in g in d u s tr ie s : m e ta ls, m a
c h in e r y an d c o n v e y a n c e s ; lea th er a n d r u b b e r g o o d s ; o ils and
p a i n t s ; p r in tin g and p a p e r g o o d s . {L a u n d e r in g o n ly .
Figures in parentheses indicate percentage change from No
vember, 1930.
December, 1931
sonally adjusted index 11 points to 34 per cent
of the 1923-1925 average, the lowest point dur
ing the thirteen-year period covered by the
index. A s a result of this low rate of output,
orders and shipments, although below October
levels, were in excess of production and there
was a decline in inventories held by the mills.
Building and construction activity in the
District as indicated by value of building per
mits issued and contracts awarded declined
substantially more during N ovem ber than is
usual at this season of the year. This Bank’s
index of the total value of construction reached
a level of approximately one-third the five-year
average (1926-1930) for November. Building
permits issued declined in value somewhat
less than seasonally in 70 of the smaller cities
of the District, but there was a sharp decline,
after seasonal adjustment, in the figures of the
20 larger cities. The value of engineering con
tract awards was less than half as large in
November as in October. W hile all classifica
tions, with the exception of waterworks, de
clined as compared with the previous month,
the largest decreases were in awards for indus
trial and commercial buildings. A t $1,260,000
the combined value of contracts in these two
groups was considerably low er than any com
parable figures of record since January, 1922,
when these data were first collected.
District flour mills increased their output
during November by approximately the sea
sonal amount and were much more active than
during the same month a year ago. A m ong the
factors contributing to this high rate of output
was the demand of the Federal Farm Board
for making deliveries of wheat and flour to
China under the recent agreement. There was
also a fair domestic demand during the month
and some mills reported that they were build
B U IL D IN G
P E R M IT S
93
FEDERAL RESERVE AGENT AT SAN FRANCISCO
IN D E X
ing up depleted stocks. Export business other
than that arising from Farm Board shipments
was reported to be inactive.
The pack of canned tomatoes in California
during 1931 amounted to only 1,005,507 cases,
a decrease of 76 per cent as compared with
1930 and 68 per cent as compared with the
average annual pack from 1926 through 1930.
In 1921 the pack of tomatoes dropped to about
357,000 cases, but with this exception the cur
rent season’s output was smaller than in any
year since 1909.
Trade
Although it is difficult to measure, some al
lowance must be made for the effect of whole
sale and retail price declines during the past
year in all comparisons of value figures of
trade activity. Despite this necessary qualifica
tion, available data indicate that Twelfth Dis
trict trade in November was markedly less
active than it was a year ago and declined
sharply as compared with October. After al
lowance for seasonal changes, wholesale sales
remained at the October level, but department
store sales did not show the usual November
gain, while registrations of new automobiles
and intercoastal traffic through the Panama
Canal declined. The adjusted index of carloadings continued to move downward. During O c
tober the District’s foreign trade, seasonally
adjusted, remained unchanged as compared
with September.
Daily average value of department store
sales in principal cities of the District were
the same in Novem ber as in October. This
Bank’s seasonally adjusted index, however,
declined approximately 4 per cent, since an
increase usually takes place from October to
November. Seasonally i 1justed sales in Los
NUM BERS
TOTAL
C O N S T R U C T IO N A N D
CONTRACTS
In dexes of building perm its issu ed, engineering contracts aw arded, and total building and con stru ction , adjusted (o r seasonal variations
(1923-1925=100). Original data w ere sm oothed b y a th ree-m onth m oving average.
MONTHLY REVIEW OF BUSINESS CONDITIONS
94
Angeles remained about the same as in O cto
ber, while those for Oakland increased. Stores
in San Francisco and Seattle showed sub
stantial declines in the value of sales, after
allowance for seasonal factors, as compared
with the previous month. Inventories carried
by department stores increased less than is
usual during November.
R E T A I L T R A D E — T w elfth D istrict
t--------------1931 com pared with 1930*---------------\
N ET SALES
N ovem ber
Jan. 1— N o v . 30
D e p a r tm e n t S to r e s . . — 14.4 ( 6 9 )
— 10.5 ( 6 4 )
— 6.5 (
3)
P h o e n ix ......................— 5.0 ( 3 )
L o s A n g e le s ............ — 12.0 ( 10)
— 11.2 ( 10)
O th e r S o u th e r n Cal. — 12.7 ( 8 )
— 10.3 ( 8 )
O a k la n d ...................... — 15.1 ( 4 )
— 5.5 (
4)
S an F r a n c is c o . . . . — 11.6 (
7)
— 8.8 (
6)
O th e r N o rth e r n C al. — 11.6 ( 8 )
— 2.1 (
8)
P o r t la n d f
................. — 17.7 (
7)
— 13.6 (
7)
S ea ttle ........................ — 28.4 (
5)
— 16.4 (
5)
5)
— 6.3 (
3)
S p o k a n e ..................... — 10.5 (
S alt L a k e C i t y ____ — 10.9 ( 4 )
— 10.4 (
4)
A p p a r e l S to re s ............ — 17.5 ( 2 7 )
— 12.9 ( 2 5 )
F u rn itu r e S to r e s . . . . — 19.2 ( 39)
— 14.5 ( 35 )
A ll S t o res ......................— 15.2 (1 3 5 )
— 11.2 (1 2 4 )
STO C K S
N ov em ber
— 13.2 (5 1 )
...( ..)
— 14.2 ( 9 )
— 11.8 ( 6)
— 15.3 ( ~4)
— 11.9 ( 7 )
— 9.7 ( 8 )
— 8.7 ( 7)
— 17.7 ( 5)
— 7.0 ( 3 )
— 17.6 ( 3)
— 19.1 (1 8 )
— 13.3 (2 9 )
— 13.7 (9 8 )
^ P e rce n ta g e ch a n g e, f ln c lu d e s five app arel sto re s w h ich are n o t
in clu d e d in D is tr ic t d e p a rtm e n t store tota l.
F ig u r e s in paren th eses in d ica te n u m b er o f stores re p o rtin g .
Sales at wholesale declined in value by about
the usual amount during November, and were
23 per cent lower than a year ago. A relatively
favorable comparison was shown in sales of
wholesale groceries, which were but 9 per cent
smaller in value than in November, 1930. Sales
in other lines for which reports are received
showed about the same relation to 1930 sales
as in other recent months.
Registrations of new automobiles declined
by somewhat more than the average OctoberNovember decline of recent years. The actual
number of new passenger cars sold was smaller
than in any other month since these data were
first collected (January, 1922). Sales of new
trucks also decreased during November.
Distribution and Trade-—
t---------- 1931- ---------- >
1930
N ov.
O ct.
Sept.
N ov.
C a rlo a d in g s t
t-------- Index N um bers*
68
66
85
64
T o ta l ............................................................
84
101
81
83
M e r ch a n d is e and M is c e lla n e o u s . . .
F o r e ig n Trade®
T o t a l t ..........................................................
I m p o r t s f ...................................... ..............
E x p o r ts .......................................................
In te r co a s ta l Trade®
T o t a l ............................................................
W e s tb o u n d ................................................
E a s tb o u n d ................................................
74
88
70
64
58
67
75
63
81
90
94
88
76
94
71
70
92
64
88
109
82
40
36
85
C o lle c tio n s #
R e g u l a r ..........
45
41
91
61
56
114
67
60
148
Prices
During late November and early Decem ber
wholesale com m odity prices as measured by
weekly index numbers declined to new low
levels for 1931 after some five months of rela
tive stability. W holesale prices as measured
by the monthly index of the United States
Bureau of Labor Statistics, however, declined
but little during November, although that in
dex was 3 per cent lower in November than in
June and 15 per cent lower than in November,
1930. The serious maladjustment of interna
tional trade, adverse conditions arising from
the departure of many countries from the gold
standard, and the apparent failure of important
production restriction measures and marketing
schemes to afford relief during the past year
have all been important factors making for
lower prices in terms of gold.
W heat prices, after declining about 10 cents
a bushel during November, fluctuated within
a relatively narrow range during the first half
Bank Debits* —
A r iz o n a
$
C a lifo rn ia
B a k e rsfie ld .........
B e r k e le y ............ ..
L o n g B e a ch
L o s A n g e le s . . .
O a k la n d ............
P a sa d e n a ..........
S a c r a m e n to
San B e r n a rd in o ,
San D ie g o
S an F r a n c i s c o . . .
S a n J o s e ............
San ta B a r b a r a ..
S t o c k t o n ..............
N ovem ber,, N o ve m b e r, *— F irst 11 M o n t h s — ^
1930
1931
1930
1931
$ 328,322
$ 398,745
$
31,984
25,865
9,880
15,469
22,361
29,911
618,745
159,714
23,963
42,276
7,337
37,160
665,931
20,673
12,526
14,879
14,499
15,201
34,120
40,928
800,662
178,709
28,632
43,373
8,549
45,300
1,098,177
26,225
13,792
18,971
115,768
183,007
248,328
436,090
8,576,540
2,035,525
324,958
511,587
94,345
511,885
10,347,045
267,820
142,114
187,993
143,092
212,945
364,975
528,339
11,039,276
2,094,683
371,168
535,026
112,043
599,509
13,842,364
304,947
170,283
264,140
12,104
14,268
145,832
158,689
8,393
9,976
109,900
122,866
4,806
136,032
6,202
172,936
59,794
1,570,341
75,432
1,939,736
13,638
54,144
23,047
70,659
153,156
645,802
203,337
799,455
5,387
7,841
144,094
35,788
25,491
11,132
7,285
9,486
204,221
41,244
39,175
17,258
72,820
99,629
2,074,290
448,247
356,208
131,663
100,571
135,896
2,582,319
562,684
486,867
162,530
Id a h o
N evada
P o rtla n d
............
U ta h
S a lt L a k e C ity . ,
94
88
98
91
99
94
111
103
W a s h in g t o n
B e llin g h a m
n.v;ium l ig u ics
41.8
14.4
45.3
15.7
39.6
16.8
43.1
15.4
* A d ju s t e d fo r sea so n a l v a r ia tio n s, 1923-1925 average^rlOO.^ ®Ind e x e s are fo r three m o n th s e n d in g w ith m o n th in d ica te d .
t E x c l u d i n g ra w silk . $ D a ily a v era g e. § A t end o f m o n th .
# P e r c e n t o f c o lle c t io n s d u r in g m o n th to a m o u n t o u ts ta n d
in g at first o f m o n th .
Both eastbound and westbound shipments
through the Panama Canal declined substan
tially from October to November. As a result
of sharp declines in the movement of lumber
and petroleum, total eastbound traffic de
creased by an amount somewhat in excess of
the usual decrease at this season of the year.
W estbound cargo, which ordinarily increases
during November, declined as compared with
the preceding month.
O re g o n
R e ta il T r a d e
A u to m o b ile S a le s?
D e p a rtm e n t S to r e
S alesJ .................
S t o c k s § ..............
December, 1931
S p o k a n e ............ ..
T a com a
............
Y a k im a ................
T o ta l.
2,165,540
*In thousands of dollars.
$3,014,879 $30 ,179,009 $38 ,311,917
December, 1931
FEDERAL RESERVE AGENT AT SAN FRANCISCO
of December. On Decem ber 12 the December
contract for wheat at Chicago sold as low as
52^4 cents per bushel, about 9 cents lower
than on November 12. Other grain prices were
comparatively stable during late November
and early December. Several other agricul
tural products of importance in the District
showed price declines during this period. But
ter and egg prices declined as is usual during
early Decem ber and were at levels approxi
mating those of a year ago. Oranges and
lemons were quoted below prices of October,
1931, or November, 1930, as were hogs, lambs,
and wool. Prices for cattle, beans, hay, cotton,
hides, and dried and canned fruits changed
little during late Novem ber and the first two
weeks in December. Potato and apple prices
increased slightly. The Department of A gri
culture’s index of farm prices was 32 per cent
lower in November, 1931, than in November,
1930.
Lead, zinc, copper, and silver prices declined
in late November and fluctuated irregularly
during early December. Copper reached a new
low price of 6*4 cents per pound, delivered
Connecticut Valley, on N ovem ber 27, but had
advanced to 7)4 cents per pound on Decem
ber 21.
No appreciable change in lumber or petro
leum prices was recorded during the latter
part of November. Relatively stable prices for
these products have prevailed during recent
months, follow ing upon and during a period
in which production has been approximately
equal to apparent consumption.
Credit Situation
Further contraction in the volume of credit
in use in the Twelfth District occurred during
November and the first half of December. Cur
rency circulation continued the non-seasonal
decreases noted last month and the volume
of Reserve Bank credit employed in the Dis
trict declined to approximately the levels of
mid-September, although some expansion is
usual at this time of the year. This Bank also
reduced the amount of its credit extended out
side the Tw elfth District by about 20 million
dollars during the four-week period. A t report
ing member banks, deposits continued to de
crease, as did total loans, but investments
showed an increase which reflected chiefly the
purchase of Government securities offered by
the United States Treasury on December 15.
Those factors which may be said to repre
sent the supply of banking funds available for
use decreased by about 19 million dollars dur
ing the four weeks ended Decem ber 16. The
element of Reserve Bank credit, which readily
expands or contracts in response to contraction
or expansion in the other factors of credit
95
supply or to changes in demand for credit,
declined 29 million dollars during the period
under review. M ost of this decline occurred
in discounts, a decrease of about 2 million dol
lars in holdings of locally purchased accept
ances being nearly offset by an increase in
credit extended to the District in other forms,
principally credit given for checks and other
items not actually collected and representing,
in effect, a temporary loan extended by the
Reserve Bank to the depositing bank. A ddi
tional factors reducing the supply of credit
available to the District were represented in a
net loss of about four million dollars in the
gold settlement fund due to an excess of trans
fers out of the District over transfers into the
District which reflected net payments involved
in commercial and financial transactions with
other parts of the United States. These reduc
tions in the Twelfth District supply of bank
ing funds amounting to 33 million dollars were
partially offset by an increase of 14 million
dollars in the available credit supply due to
operations of the United States Treasury,
which spent that much in excess of its collec
tions in the District during the four weeks
ended December 16.
The corresponding net decline in the demand
for funds resulted principally from a 17y2 mil
lion dollar decline in member bank reserve
balances. Demand for currency decreased
more than 2y2 million dollars, while as a slight
offsetting factor deposits of non-member banks
at the Reserve Bank and other miscellaneous
items representing a demand upon the Dis
trict’s credit resources increased about one mil
lion dollars, making a net decrease of about 19
million dollars in demand for credit during the
four weeks ended December 16. A tabulation
of changes in the factors affecting supply of
and demand for credit in the Twelfth District
between November 18 and December 16
fo llo w s:
SU PPLY O F A N D D E M A N D FO R FU N D S
C h anges betw een N o v e m b e r 18 and D e ce m b e r 16,1931.
(I n m illio n s o f dollars)
Supply
M o n e ta r y G o ld S t o c k . . — 3.8
T r e a s u r y O p e r a tio n s . .
13.8
R e s e r v e B a n k C r e d i t . . . — 29.2
D i s c o u n t s ......... — 28.8
A c c e p t a n c e s . . — 2.0
O th e r C re d it . .
1.6
— 19.2
D em and
D e m a n d fo r C u r r e n c y . . — 2.6
M em b er B a n k R eserve
B a la n ce s ........................ — 17.5
N o n -m e m b e r D e p o s its ,
0.9
T o t a l ....................................
— 19.2
Approximately 67 million dollars of imported gold coin and bullion was received, at
the San Francisco Mint during the period
under review. Since the proceeds of these sales
of gold to the Mint were transferred east al
most immediately they had no effect upon the
District’s supply of banking funds. Between
January, 1930, when the embargo on gold ship
ments from Japan was lifted, and m id-Decem
ber of this y^ar, when that country abandoned
the gold standard, 344 million dollars of gold
MONTHLY REVIEW OF BUSINESS CONDITIONS
96
coin and bullion was imported through Pacific
^OT-srtrpb'fts^fibm Japan (including shipments
received in §an Francisco up to Decem ber 23).
B orrow ing by member banks has been de
clining since jrxud-October. The number of bor
rowing"hanks, while smaller than in October,
was substantially larger during November
than a year ago, however, and greater than
during the earlier months of this year, notwith
standing the fact that the peak in the number
of rediscounting banks usually comes in late
summer.
A s in other recent months, savings deposits
in the Tw elfth District (as reported by 44
banks in the larger cities) decreased during the
month ending Novem ber 30. This decline,
totaling 14 million dollars, accounted for a
large part of the decrease in time deposits of
REPORTING M EM B ER B A N K S — Twelfth District
(I n m illion s o f dollars)
r— '"■1 " ■— Con<3
D e c . 16,
1931
L o a n s a n d In v e s tm e n ts — T o t a l . . , 1,877
1,116
290
O n S e c u r itie s ...........................
826
A ll O t h e r ....................................
761
I n v e s tm e n ts — T o t a l ...................
414
U n it e d S tates S e c u r itie s . . .
347
O th e r S e c u r itie s ......................
88
R e s e r v e w ith R e s e r v e B a n k
654
N e t D e m a n d D e p o s i t s ...................
930
T im e D e p o s i t s ..................................
121
D u e fr o m B a n k s .............................
174
D u e t o B a n k s ..................................
47
B o r r o w in g s a t R e s e r v e B a n k . . ,
D e c. 9, N o v . 18, D e c. 17,
1930
1931
1931
2,011
1,863
1,859
1,340
1,118
1,128
299
290
436
904
829
828
671
735
741
347
392
385
349
350
324
110
96
96
752
660
666
1,032
938
945
114
127
206
175
186
264
73
74
44
weekly reporting member banks. Moderate
reductions were also shown in net demand de
posits in late Novem ber and early December.
Loans of reporting member banks have con
tinued to decline, as has been the case in the
United States as a whole, but investments of
those banks have increased since October, con
trary to the movement in the aggregate figures
for the country. The increase in investment
M IL L IO N S
250
OF
December, 1931
holdings of District banks may be explained
in part by a shifting of funds in N ew York
from call loans on securities to the purchase
of Government bonds. A sharp increase in GovFED ERAL RESERVE BANK OF SAN FRANC ISCO
(I n m illion s o f dollars)
T o t a l B ills and S e c u r i t i e s ..........
B ills D is c o u n t e d ........................
B ills B o u g h t ..................................
U n ite d S tates S e cu ritie s . . . .
T o t a l R e se rv e s ..................................
T o ta l D e p o s its .............................
F e d e ra l R e s e r v e N o t e C ir c u la tio n
R a tio T o t a l R e s e rv e s t o D e p o s it
an d N o t e L ia b ilitie s C o m b in e d .
D e c . 16,
1931
149
56
36
54
249
160
222
65.1
-— C onelition ------ -------------D e c . 9, N o v . 18, D e c . 17.
1931
1931
1930
183
200
121
83
85
48
43
58
33
54
55
40
231
223
266
177
181
194
221
225
175
58.0
55.1
72.2
ernment security holdings and in Government
deposits was recorded during the week ended
December 16. This movement was due to the
allotment to Tw elfth District banks on Decem
ber IS of 85% million dollars from the three
issues of Government securities, aggregating
one billion three hundred million dollars, dis
tributed by the United States Treasury on that
date. A s usual these securities were paid for
chiefly by crediting the Government’s deposit
account, which had been drawn down to al
most nothing prior to Decem ber 15. Some
cash payments were made and a considerable
amount of maturing obligations was ex
changed for the new issues.
The tendency toward slightly firmer inter
est rates charged customers by commercial
banks did not continue during December. The
discount rate of the Federal Reserve Bank of
San Francisco remained unchanged as did that
institution’s acceptance buying rate.
A ctivity on District stock exchanges was
sharply curtailed during November. Securities
prices declined, m oving with quotations on
eastern stock exchanges, and the number of
shares traded was substantially smaller than
in the preceding month.
M IL L IO N S
D O LLA R S
or
D O LLA R S
250
200
200
150
150
100
1927
1928
1929
1930
TWsT
RESERVE SYSTEM C R E D IT —-Twelfth District
The total amount of Reserve System Credit employed in the Twelfth District and the amount of credit extended by the Federal Reserve Bank of
San Francisco to this and other districts. (Weekly figures.)
@FedFRASER